Ministers approve Bank of Israel policy reforms
Government panel okays long-awaited proposal that would revamp framework for policymaking at Israel's central bank. Finance Minister Steinitz says reforms will benefit economy
Debate on a law to replace the current one that has been in place since 1954 has been ongoing for 12 years. It still needs parliamentary approval.
Finance Minister Yuval Steinitz said the central bank reforms would benefit the economy.
Bank of Israel Governor Stanley Fischer has lobbied hard for reforms for 4-1/2 years that would enable the central bank to act like its US and European peers.
Among the changes sought by the former Citigroup vice chairman is the creation of a board – in common with many other central banks – that would make interest rate decisions. At present, the governor alone makes the decision.
The bank would keep controlling inflation as its main monetary policy mandate, but also take into consideration supporting growth and employment.
Under the proposal, the board would be chaired by the governor. The deputy governor and another central bank official would also be members, as would a few non-bank economic professionals.
